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Plan for the Future – Calculating cost savings
Date: Tuesday, March 5, 2019
Lower whole-life costs can be achieved once you get to grips with the figures.
Last year, LeasePlan and What Van? surveyed commercial fleet managers to identify the challenges they face and which they regard as most important.
Two words stood out at the top of the list: the first was ‘compliance’, and the second, unsurprisingly, was ‘costs’. During a time of economic uncertainty, and when many prices are inflating, fleet decision-makers are eager to make savings where they can.
As most of those fleet decision-makers already know, the first stage of this process is developing an appreciation of whole-life costs. A light commercial vehicle, after all, is more than just its list price – it will incur extra costs from the moment it is driven from a garage forecourt to the moment it leaves your fleet.
Consider, for example, fuel. This is one of the most straightforward examples of an additional cost, yet it can still be quite hard to account for. Last year alone, the average price of a litre of diesel fluctuated from about £1.22 to £1.37. It is currently around the £1.30 mark. This means that the running costs for a van are changing on an almost daily basis.
Other types of cost are even more unpredictable. Politicians have already introduced various measures to encourage cleaner motoring, and we know that more are coming – however, we can’t yet be sure of the details.
Will other local authorities follow London’s example and impose charges on the dirtiest vehicles? Will the government go ahead with its new Vehicle Excise Duty regime for vans, as proposed? The answers to these questions could have huge implications for a fleet’s whole-life costs, as well as for the attractiveness of electric vehicles. It is important that fleets remain flexible enough to deal with any forthcoming legislative changes.
There are dozens of other costs to consider: maintenance, insurance, downtime, end-of-life, and so on. The good news is that, with so many costs, there is also a lot of potential for savings. Knocking a few pounds from each item can add up significantly for a single vehicle, and even more so for an entire fleet.
And there is more good news: fleet providers are here to help with this task. LeasePlan provides a whole-life costs calculator to help you with the preliminary sums, whilst our expert commercial vehicle consultants are able to offer advice on how you can reduce your whole-life costs over time. In fact, we prefer to see things a different way – there are ‘whole-life savings’ to be made.
Plan for the Future is produced in association with LeasePlan.
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